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Expect Economy to grow at around 6.5 per cent in FY25; outlook appears bright: FinMin review
India's Finance Ministry is optimistic about the country's economic growth, projecting a 6.5 percent growth in FY25. Rural demand continues to be strong, with significant increases in vehicle and tractor sales in late 2024. Urban demand is also improving, evidenced by rising passenger vehicle sales and domestic air traffic.
Expressing confidence, Finance Ministry in its monthly review has said that India's economy is set to grow at around 6.5 per cent in FY25.
"We expect the economy to grow at around 6.5 per cent in real terms in FY25," said the ministry in the review. The finance minister further said that the growth outlook for October to December appears bright, with rural demand remaining resilient and urban demand picking up in the first two months of the quarter, according to the finance ministry's monthly economic report for November.
India's GDP growth slowed to a seven-quarter low of 5.4 per cent during the July-September period of the current fiscal year. Explaining the sharp slowdown, the Finance Ministry said that the slowdown is due to softening of public capex and private capex levels being affected by global uncertainties, excess capacity, and fears of dumping. "There are signs of capital formation growth rebounding early in H2 of FY25, with Union Government capex picking up pace. The order books of infrastructure and capital goods grew sharply in FY24 and H1 of FY25, indicating a pent-up investment impulse that will play out in the quarters ahead," said the FinMin review.
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